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  • MSCI’s index of Asia-Pacific shares surge to early-March top.
  • Hopes of further stimulus, additional easing of lockdown restrictions favor the bulls.
  • Trade-negative headlines join virus troubles to cap the optimism.
  • RBNZ, BOJ Summary of Opinions suggest Asian policymakers stay cautious.

Despite initially probing the multi-day high, Asian equities portray cautious optimism while heading into the European session on Wednesday. While printing the same, MSCI’s index of Asia-Pacific shares outside Japan gains 0.50% to take the bids near the initial March month high. However, Japan’s Nikkei 225 struggles around 22,530 amid fears of easing the lockdown early and downbeat statements from the BOJ policymakers.

Elsewhere, Australia’s ASX 200 rises 0.30% to 5,973 whereas New Zealand’s NZX 50 gains over 1.4% as RBNZ shows readiness to act and also because China indicated, as per New York Times, June imports from the US to show a dramatic increase. Also supporting the mood could be US Treasury Secretary Steve Mnuchin’s hints of the second extension to the tax filing date.

On the contrary, US-China tussle continues as per the Global Times whereas Trump administration ordered investigations into the Asia tire exports and fired another trade-negative shot. Furthermore, coronavirus (COVID-19) figures from Beijing and the US dwindle and lose the importance off-late. Though, signals on how fast the nations should return to normal gain major attention, for now.

Amid these catalysts, the US 10-year treasury yields stay mildly positive around 0.72% and the stock futures also print gains as we write. Further, shares in China and India rise around 0.50% but those from Hong Kong mark losses of near 0.20% by the press time. Moving on, South Korea’s KOSPI gains 1.40% after the neighbor in the North shunned recently feared military actions.

Given the preliminary readings of PMIs already out and loud, traders will wait for key Fed speakers for fresh impulse. In doing so, the markets will keep eyes on the trade and virus updates for intermediate moves.